Artificial intelligence is playing a growing role in a surge of cryptocurrency-related fraud schemes that have already cost Americans tens of billions of dollars, according to federal investigators.
One recent case involved a retiree who lost her entire life savings after being drawn into a fake crypto investment opportunity initiated through a messaging app. The victim was gradually manipulated into transferring funds across multiple crypto wallets controlled by scammers, a pattern investigators say is increasingly common in so-called "pig butchering" schemes.
The fraud was later reconstructed by IRS Criminal Investigation agents in New York who found that stolen funds were then consolidated and moved through exchanges to obscure their origin. The use of artificial intelligence tools, including automated message generation and behavioral targeting, has made it easier for criminals to maintain long-term contact with victims while appearing legitimate.
Cyber-enabled crime cost Americans nearly $21 billion in 2025 alone, with more than half of reported losses tied to cryptocurrency transactions, according to its latest Internet Crime Report released in April 2026 and reviewed by FBI National Press Office data. FBI officials said investment fraud and impersonation schemes remain among the most frequently reported cybercrimes, and artificial intelligence is increasingly being used to scale them.
In parallel, IRS investigators say they are seeing a sharp rise in cases where AI tools are used to craft convincing scripts, impersonate customer service agents, and tailor messages based on scraped personal data. These tools are often distributed through dark web marketplaces, enabling even relatively inexperienced criminals to deploy sophisticated fraud campaigns, according to comments from IRS Criminal Investigation leadership cited in reporting by CBS News. Internal Revenue Service cyber units have also expanded their use of blockchain tracing tools to follow illicit cryptocurrency flows across wallets and exchanges.
Cybersecurity researchers and law enforcement officials have long warned that cryptocurrency's pseudonymous nature makes it attractive for laundering stolen funds. A 2022 analysis of financial crime trends by CBS News highlighted how digital assets have become a preferred tool for money laundering and cross-border fraud due to the difficulty of traditional oversight mechanisms adapting to blockchain transactions. The outlet has also noted that investigators increasingly rely on interagency cooperation to trace and seize illicit crypto holdings.
Similar trends have been highlighted by Science Focus magazine, which has reported on the rise of AI-generated voice cloning and deepfake impersonation used in financial scams targeting individuals and businesses. The magazine shows how scammers increasingly use realistic audio or video impersonations of family members or officials to pressure victims into urgent payments.
U.S. investigators are warning that the challenge is not only the sophistication of the scams but also the speed at which they evolve. IRS cyber specialists have described a constant cycle of adaptation, where enforcement teams track evolving fraud patterns while criminal groups rapidly switch tools and platforms to evade detection. Internal research and academic analysis of AI governance in financial systems also indicates that machine learning tools are now being deployed both defensively and offensively in financial crime environments, complicating detection efforts.
Authorities have urged the public to treat unsolicited investment opportunities with caution, particularly those involving cryptocurrency transfers initiated through social media or messaging apps. They stress that legitimate financial institutions do not require users to move funds into external wallets or third-party crypto accounts to access returns or bonuses.
